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| Guangzhou Quizzed over Shortfall in Pensions |
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Concern is being raised over Guangzhou's huge pension shortfall. Deputies to this year's Guangzhou municipal people's congress have quizzed department leaders about 800 million yuan (US$100 million) that was invested 13 years ago, just before a change in national policy demanded it be recalled. Zhang Jieming, director of the municipal labour and social security bureau, revealed that only about one-third of the figure has so far been clawed back. He added that hope of retracting the remainder of the sum was diminishing. According to the official, an unexpectedly swift policy change was to blame. State authorities allowed regional institutions responsible for social insurance and pensions to make money on part of their funds in 1993 by seeking investment opportunities. The then Guangzhou Social Security Corp of Guangzhou Labour Bureau poured more than 800 million yuan (US$100 million) into 25 investment projects in the year. One year later, however, State authorities ruled such investments were disallowed and urged related institutions to take back the money as soon as possible. As the city's social security company had signed contracts for the investment projects, Zhang said, the policy change made it very difficult to retract the money. The municipal government set up its social security bureau in 1997, which took over the job of tracing back the money. Three years later, it regrouped its labour and social security bureaux into a single unit which has been stepping up the efforts. He reassured deputies that there was no major cause for concern over the city's pension structure. "Guangzhou's social insurance and pensions operation can keep on track," he said. "Certainly it would be good news if the municipal's fiscal revenue could fill the gap first." According to the official, Guangzhou has risk funds to cover social insurance payments each year and the budget for 2006 has been enhanced to 80 million yuan (US$10 million), from 50 million yuan (US$6.25 million) annually, to cover emergencies. Official statistics indicate that Guangzhou's fiscal revenue balance surpassed 8 billion yuan (US$1 billion) in 2005. Yang Chenghua, a deputy from Guangzhou Liwan No 2 Hospital, said that many deputies hope related government departments will gear up efforts to claim the pensions money back via more channels, including legal litigation and property auctions. "Many projects depend on fiscal revenues, and the large pension gap will undoubtedly lead to inadequate support in other urgent projects," the deputy said. Yang said that he and many other deputies would be keeping a close eye on the situation, and would challenge the government if retirees were unable to claim their pensions because of the problem. (China Daily March 27, 2006) |
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